Debt consolidation calculator
Rolling everything into one loan simplifies your month. Whether it saves money depends on the rate, the fee and the term. Check before you apply.
Your debts
Keep current debts
Pay $607/mo, avalanche order
2 yrs 10 mo
$3,165 interest
Minimums only: 6 yrs 5 mo, $5,772 interest
Consolidation loan
Borrow $18,147 to net $17,240
$607.10/mo
$4,615 interest + fee over 3 yrs
At this rate and fee the loan costs $1,450 more than putting the same $607 a month toward your current debts with the avalanche. You don’t need a loan to get this result.
When consolidation makes sense
- The loan APR, including the fee, is clearly below the weighted rate on your current debts.
- You can afford the fixed payment every month for the full term.
- You have a plan to keep the paid-off cards at zero.
A longer term lowers the payment but raises total interest, sometimes above what you pay now. Compare with a 0% balance transfer for card debt, or skip the loan and run the avalanche on what you have. If you’re struggling to make minimums, a nonprofit credit counselor (NFCC member agencies offer free or low-cost sessions) can discuss a debt management plan.
Questions people ask
How does a debt consolidation loan work?
You take out one personal loan, use it to pay off several debts (usually credit cards), and then make a single fixed payment for a set term. It helps when the loan’s APR, including fees, is lower than what you’re paying now and you don’t run the cards back up.
What is an origination fee?
A one-time fee some lenders charge, often 1% to 10% of the loan, usually taken out of the money you receive. To end up with enough to pay off your debts, you borrow a little more. This calculator grosses the loan up so the payoff amount is fully covered.
Is consolidation better than the avalanche?
Only if the loan rate is meaningfully lower than your current rates. The calculator compares the loan with paying the same monthly amount on your current debts using the avalanche, which is the fair comparison.
Will consolidating hurt my credit?
Applying causes a hard inquiry, and a new account lowers your average account age, which can dip your score briefly. Paying cards down lowers your utilization, which often helps. Missing loan payments or re-running up the cards would hurt.